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Questions and Answers
What is the primary function of money in an economy?
What is the primary function of money in an economy?
- Facilitating exchange of goods and services (correct)
- Stimulating economic growth through investments
- Generating profit for individuals
- Controlling government spending
How does credit contribute to economic activity?
How does credit contribute to economic activity?
- Increasing government regulations on financial transactions
- Encouraging saving and reducing consumption
- Reducing the overall money supply in the economy
- Enabling consumers to make purchases beyond their immediate financial means (correct)
What is the role of central banks in the money and credit system?
What is the role of central banks in the money and credit system?
- Issuing currency for circulation within the economy
- Providing loans to individuals for personal expenses
- Guaranteeing profits for commercial banks through financial assistance
- Regulating the money supply and interest rates to control inflation and economic growth (correct)
